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Qualifications and future labour market in Australia A person’s educational qualifications provide essential labour market information to employers in filling vacancies and help individuals in the development of career paths. They also provide a measure of the output of Australia’s training system. Chandra Shah and Gerald Burke from the Monash University-ACER Centre for the Economics of Education and Training (CEET) presented a paper at CEET’s annual conference on 3 November on the future supply of, and requirements for, vocational education and training (VET) qualifications in Australia. The qualifications profile of the employed workforce was derived from estimates of growth in employment and skills deepening within occupations. Skills deepening in an occupation is measured as the increase in the proportion of people with qualifications over and above that due to employment growth. The ABS Education and work survey data from 2001 to 2005 indicate considerable skills deepening in Australia. Assuming these trends continue, the proportion of employed people with qualifications in 2016 is estimated to be 71.2 per cent compared with 58 per cent in 2005, with increasing numbers achieving qualifications at higher levels. Employment in Australia will grow more slowly from 2006 to 2016, with faster growth in higher skilled occupations than in lower skilled occupations. To increase qualifications held by Australians in work to targeted levels, more training will be required for substantial numbers of new entrants and for existing workers. The number of additional people who will need to have qualifications from 2006 to 2016 is estimated to be 4.03 million, 2.25 million new entrants and 1.78 million existing workers. Of these, 61.4 per cent will need a VET qualification and 38.6 per cent a higher education qualification. Among VET qualifications needed, 49.3 per cent will be at certificate III/IV, 35.7 per cent at advanced diploma/diploma and remainder at certificate I/II. If supply of people with VET qualifications remains at the same level as in 2005, a shortfall of 240,000 is expected over the ten years to 2016. Shortfalls are expected at the advanced diploma, diploma and certificate III levels. Surpluses are expected at certificate I, II and IV levels. A shift in distribution to the higher qualifications means a considerable increase in the average time taken to complete a course. Training hours delivered will, therefore, need to increase five per cent per year to ensure not only the required number of qualified people become available, but also that their qualifications are at appropriate levels. Estimates of future qualifications required by the employed workforce in this report are based on Australia having 11.23 million people employed in 2016. However, if employment was to increase above this level (eg. through higher participation in the labour force) then training requirements will be higher than these estimates. The full report, Qualifications and the future labour market in Australia, is available from the Early Childhood Development website. Further information about the CEET annual conference is available from the CEET website. « Back to eNews
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A person’s educational qualifications provide essential labour market information to employers in filling vacancies and help individuals in the development of career paths. They also provide a measure of the output of Australia’s training system.

Chandra Shah and Gerald Burke from the Monash University-ACER Centre for the Economics of Education and Training (CEET) presented a paper at CEET’s annual conference on 3 November on the future supply of, and requirements for, vocational education and training (VET) qualifications in Australia.

The qualifications profile of the employed workforce was derived from estimates of growth in employment and skills deepening within occupations. Skills deepening in an occupation is measured as the increase in the proportion of people with qualifications over and above that due to employment growth. The ABS Education and work survey data from 2001 to 2005 indicate considerable skills deepening in Australia. Assuming these trends continue, the proportion of employed people with qualifications in 2016 is estimated to be 71.2 per cent compared with 58 per cent in 2005, with increasing numbers achieving qualifications at higher levels. Employment in Australia will grow more slowly from 2006 to 2016, with faster growth in higher skilled occupations than in lower skilled occupations.

To increase qualifications held by Australians in work to targeted levels, more training will be required for substantial numbers of new entrants and for existing workers. The number of additional people who will need to have qualifications from 2006 to 2016 is estimated to be 4.03 million, 2.25 million new entrants and 1.78 million existing workers. Of these, 61.4 per cent will need a VET qualification and 38.6 per cent a higher education qualification. Among VET qualifications needed, 49.3 per cent will be at certificate III/IV, 35.7 per cent at advanced diploma/diploma and remainder at certificate I/II.

If supply of people with VET qualifications remains at the same level as in 2005, a shortfall of 240,000 is expected over the ten years to 2016. Shortfalls are expected at the advanced diploma, diploma and certificate III levels. Surpluses are expected at certificate I, II and IV levels.

A shift in distribution to the higher qualifications means a considerable increase in the average time taken to complete a course. Training hours delivered will, therefore, need to increase five per cent per year to ensure not only the required number of qualified people become available, but also that their qualifications are at appropriate levels.

Estimates of future qualifications required by the employed workforce in this report are based on Australia having 11.23 million people employed in 2016. However, if employment was to increase above this level (eg. through higher participation in the labour force) then training requirements will be higher than these estimates.

The full report, Qualifications and the future labour market in Australia, is available from the Early Childhood Development website.

Further information about the CEET annual conference is available from the CEET website.

Qualifications and future labour market in Australia